Employee pay day - calculating Income Tax and Universal Social Charge

Other payments

Note

The information on this page refers to current employer obligations. For employer obligations before 1 January 2019, please see the Employers' Guide to PAYE.

An employer may pay their employees a bonus or arrears of pay on a day outside of their regular pay day. Calculate the tax and Universal Social Charge (USC) due on the total of that week's payments. Use the tax credits, tax cut-off points and USC cut-off points at that week.

The employer cannot use tax credits, tax cut-off points and USC cut-off points from a future week to cover any additional payment they make.

Holiday pay

An employer may pay their employee 'holiday pay' in advance of their usual pay day. 

Advance holiday pay may result in the employee receiving two or three weeks' pay in one week. The employee then receives no pay in the following two or three weeks. The employer may apply those weeks' tax credits, tax cut-off points and USC cut-off points to the holiday pay. This cannot be done if the employee is leaving employment immediately after receiving holiday pay.

Pay earned before 1 January, but paid on or after that date

Pay might be earned before 1 January, but paid on or after that date. The employer must deduct tax, USC and Pay Related Social Insurance (PRSI) at the time they make the payment. They must apply the tax credits, tax cut-off points and USC cut-off points applicable for the employee at the time the payment is made. The payment must be reported to Revenue, on or before the pay date.